Garuda Maintenance Facility AeroAsia, the aircraft maintenance and repair unit of Indonesia's national flag carrier Garuda Indonesia, is set to sell a 30 percent stake in an initial public offering (IPO) on the Indonesia Stock Exchange in early October 2017. The offering period is scheduled for 2-4 October 2017.
The company will offer 10.9 billion new shares, equivalent to 30 percent of Garuda Maintenance Facility AeroAsia's total paid up capital, to investors at a price that currently still ranges between IDR 390 and IDR 510 a piece, reflecting a price to earnings ratio (PER) of 14.5 - 18.9 times (regarded an attractive valuation, below the benchmark's average). Hence, the company could raise up to IDR 5.5 trillion (approx. USD $417 million) worth of fresh funds. This would make the company's IPO the biggest so far in 2017.
Iwan Joeniarto, Chief Executive of Garuda Maintenance Facility AeroAsia (GMF AeroAsia), informed that 60 percent of the funds that are generated through the IPO will be used by the company to establish a new unit on Batam island near Singapore as well as for overseas expansion (particularly in Dubai, Australia, and East Asia). Meanwhile, 25 percent of proceeds will be used as working capital, while the remainder is set to be used to refinance the company's debt.
Four securities companies have been appointed as underwriters: Bahana Sekuritas, BNI Sekuritas, Danareksa Sekuritas, and Mandiri Sekuritas (lead underwriter).
Meanwhile, Joeniarto hopes that 10 percent of the new shares will go to several strategic partners, both at home and abroad (for example in Hong Kong, Singapore, or Hong Kong).
Through the corporate move, GMF AeroAsia aims to become among the top ten of biggest aircraft maintenance, repair and operations (MRO) companies in the world by 2021 with annual revenue of over USD $1 billion.
In the first quarter of 2017 GMF AeroAsia recorded USD $106.1 million worth of sales, up 72.2 percent year-on-year (y/y) from USD $61.6 million in the same quarter one year ago. Meanwhile, the company's full-year 2016 sales rose 27.2 percent (y/y) to USD $389 million, while its net profit rose 59.6 (y/y) to USD $57.7 million in 2016.
Currently, about 65 percent of GMF AeroAsia's revenue stems from Garuda Indonesia, while the remainder comes from other airlines. In five years time, it wants to reverse this ratio.
Prior to the IPO, Garuda Indonesia owns a controlling 99 percent stake in GMF AeroAsia. GMF AeroAsia, which spun off as an independent unit from Garuda Indonesia in 2002, is Indonesia's largest aircraft maintenance operator with clients (airlines) spread across 55 countries. Its regional competitors include Singapore-based SIA Engineering Company Ltd and Hong Kong Aircraft Engineering Co Ltd.
Last Update: 22 Sep 2017
IPOs on the Indonesia Stock Exchange in 2017 up to 12 September 2017
|Company||P: 22 Sep 2017||P: 21 Sep 2017||Gain/Loss||P/E ttm||Yield %||Gain/Loss YTD|
|Forza Land IndonesiaFORZ||720||720||0.00%||N/A||0.00%||74.76%|
|Industri dan Perdagangan Bintraco DharmaCARS||1,450||1,440||0.69%||N/A||0.00%||-16.67%|
|Nusantara Pelabuhan HandalPORT||368||368||0.00%||N/A||0.00%||-36.00%|
|Pelayaran Tamarin SamudraTAMU||3,510||3,520||-0.28%||N/A||0.00%||1,292.86%|
|Cahayasakti Investindo SuksesCSIS||840||840||0.00%||N/A||0.00%||50.00%|
|Terregra Asia EnergyTGRA||510||500||2.00%||N/A||0.00%||50.00%|
|First Indo American Leasing Tbk.FINN||195||195||0.00%||N/A||0.00%||9.55%|
|Alfa Energi Investama Tbk.FIRE||1,395||1,390||0.36%||N/A||0.00%||86.00%|
|Totalindo Eka Persada Tbk.TOPS||2,280||2,340||-2.56%||N/A||0.00%||391.38%|
|Kirana Megatara Tbk.KMTR||450||448||0.45%||N/A||0.00%||-34.31%|
|Hartadinata Abadi Tbk.HRTA||274||276||-0.72%||N/A||0.00%||-17.47%|
|MAP Boga Adiperkasa Tbk.MAPB||2,040||2,050||-0.49%||N/A||0.00%||-19.05%|
|Armidian Karyatama Tbk.ARMY||306||314||-2.55%||N/A||0.00%||-32.00%|
|Buyung Poetra Sembada Tbk.HOKI||290||286||1.40%||N/A||0.00%||-15.20%|
|Marga Abhinaya Abadi Tbk.MABA||2,100||2,100||0.00%||N/A||0.00%||1,005.26%|
|Megapower Makmur Tbk.MPOW||326||320||1.87%||N/A||0.00%||-4.12%|
|Mark Dynamics Indonesia Tbk.MARK||760||780||-2.56%||N/A||0.00%||103.21%|
|Ayana Land International Tbk.NASA||372||374||-0.53%||N/A||0.00%||112.57%|
Green colour indicates upward movement
Red colour indicates downward movement
P = price; E = earnings; D = dividend; Yield = D/P
"N/A" indicates P/E < 0 (negative earnings)
"-" indicates E,D,P or YTD is not available